One Last Point Before Thanksgiving...

We continue our education into how the world operates...

Dear Fellow Expat:

Maybe this isn’t for you. But when the markets experience a dramatic shakeup in the next 18 months - investors will want to know the make, color, and year of the car that hit them, and a description of the driver.

The media will tell you that the driver was orange with blonde hair.

But I assure you - it was a clown car full of central bankers and hedge fund managers.

We continue to explore Capital Wars by Michael Howell. As we’ve explained, there is a refinancing crisis on the horizon. The system has changed dramatically from investment in the real economy to grand-scale financialization over the last three decades.

Today, we have to understand the difference between the two things.

Two Circuits, One Mess

In Chapter 5, Howell introduces his two-circuit theory, which reveals how money really moves in today's world. The economy has two separate power systems, like a house with two electrical grids.

The Industrial Circuit processes real things - building factories, making…